EX-99 3 ex99-1.txt FOR IMMEDIATE RELEASE CONTACTS: James G. Rakes, President & CEO (540) 951-6236 J. Robert Buchanan, Treasurer (276) 979-0341 NATIONAL BANKSHARES, INC. ANNOUNCES FIRST QUARTER EARNINGS BLACKSBURG, VA, APRIL 14, 2004: National Bankshares, Inc. (Nasdaq SmallCap Market: NKSH) today announced first quarter net income of $2.96 million, or basic net income of $0.84 per share. This is a 12.46% increase over the $2.63 million, or $0.75 per share, that was earned in the first quarter of 2003. At March 31, National Bankshares, Inc., the parent company of the National Bank of Blacksburg, Bank of Tazewell County and National Bankshares Financial Services, had total assets of $708.14 million, slightly higher than the $699.74 million on March 31, 2003. In making the earnings announcement, Chairman, President & CEO James G. Rakes said, "We continue to see the effects of a low interest rate environment on the interest expense category, and this has translated into solid earnings. In addition we have been pleased with the nice increase in non-interest income. At the same time we have worked to control non-interest expense." Mr. Rakes continued, "In the next few days we anticipate closing Bank of Tazewell County's previously announced purchase of loans and assumption of deposits of FNB Southeast's Richlands, Virginia branch office. These loans and deposits will be serviced by BTC's existing Richlands Office. Later in the second quarter, subject to regulatory approval, The National Bank expects to purchase Community National Bank in Pulaski, Virginia. We look forward to welcoming the new customers who will be banking with us as a result of these transactions." National Bankshares, Inc. is a financial holding company with headquarters in Blacksburg, Virginia. It has two community bank subsidiaries, The National Bank, headquartered in Blacksburg, and Bank of Tazewell County, with its main office in Tazewell, Virginia. The two banks serve Southwest Virginia with a total of 24 offices. The company also operates a non-bank subsidiary, National Bankshares Financial Services, Inc., which does business as National Bankshares Investment Services and National Bankshares Insurance Services. National Bankshares, Inc. stock trades on the Nasdaq Stock Market under the symbol "NKSH". Additional information is available on the company's web site at www.nationalbankshares.com. (unaudited tables follow)
National Bankshares, Inc. And Subsidiaries (000's), except ratios Three months Three months and per share data ending ending Year-to-date Year-to-date March 31, March 31, March 31, March 31, Selected Consolidated Data: 2004 2003 Change 2004 2003 Change ------------------------------------------------------------------------------------------------------------- Interest income $9,797 10,476 -6.48% $9,797 $10,476 -6.48% ------------------------------------------------------------------------------------------------------------- Interest expense 2,599 3,478 -25.27% 2,599 3,478 -25.27% ------------------------------------------------------------------------------------------------------------- Net interest income 7,198 6,998 2.86% 7,198 6,998 2.86% ------------------------------------------------------------------------------------------------------------- Provision for loan losses 288 440 -34.55% 288 440 -34.55% ------------------------------------------------------------------------------------------------------------- Noninterest income 1,739 1,369 27.03% 1,739 1,369 27.03% ------------------------------------------------------------------------------------------------------------- Noninterest expense 4,820 4,567 5.54% 4,820 4,567 5.54% ------------------------------------------------------------------------------------------------------------- Income taxes 869 728 19.37% 869 728 19.37% ------------------------------------------------------------------------------------------------------------- Net income $2,960 2,632 12.46% $2,960 2,632 12.46% ------------------------------------------------------------------------------------------------------------- Basic net income per share $0.84 $0.75 $0.09 $0.84 $0.75 $0.09 ------------------------------------------------------------------------------------------------------------- Fully diluted net income per share --- --- --- --- --- --- ------------------------------------------------------------------------------------------------------------- Dividends per share --- --- --- --- --- --- ------------------------------------------------------------------------------------------------------------- Dividend payout ratio --- --- --- --- --- --- ------------------------------------------------------------------------------------------------------------- Book value per share --- --- --- $24.11 21.57 $2.54 ------------------------------------------------------------------------------------------------------------- Balance sheet at period-end: ------------------------------------------------------------------------------------------------------------- Loans, net --- --- --- $406,894 404,685 0.55% ------------------------------------------------------------------------------------------------------------- Total securities --- --- --- 246,795 227,745 8.36% ------------------------------------------------------------------------------------------------------------- Total deposits --- --- --- 619,920 620,773 -0.14% ------------------------------------------------------------------------------------------------------------- Other borrowings --- --- --- 77 178 -56.74% ------------------------------------------------------------------------------------------------------------- Stockholders' equity --- --- --- 84,754 75,726 11.92% ------------------------------------------------------------------------------------------------------------- Total Assets --- --- --- 708,142 699,742 1.20% ------------------------------------------------------------------------------------------------------------- Daily averages: ------------------------------------------------------------------------------------------------------------- Loans,net $403,213 400,899 0.58% $403,213 400,899 0.58% ------------------------------------------------------------------------------------------------------------- Total securities 240,522 223,158 7.78% 240,522 223,158 7.78% ------------------------------------------------------------------------------------------------------------- Total deposits 623,655 610,397 2.17% 623,655 610,397 2.17% ------------------------------------------------------------------------------------------------------------- Other borrowings 135 239 -43.51% 135 239 -43.51% ------------------------------------------------------------------------------------------------------------- Stockholders' equity 83,290 74,614 11.63% 83,288 74,614 11.63% ------------------------------------------------------------------------------------------------------------- Interest-earning assets 676,478 655,048 3.27% 676,478 655,048 3.27% ------------------------------------------------------------------------------------------------------------- Interest-bearing liabilities 540,307 536,915 0.63% 540,307 536,915 0.63% ------------------------------------------------------------------------------------------------------------- Total Assets 710,067 687,922 3.22% 710,067 687,922 3.22% ------------------------------------------------------------------------------------------------------------- Financial ratios: Note (1) ------------------------------------------------------------------------------------------------------------- Return on average assets 1.68% 1.55% 0.13 1.68% 1.55% 0.13 ------------------------------------------------------------------------------------------------------------- Return on average equity 14.29% 14.31% -0.02 14.29% 14.31% -0.02 ------------------------------------------------------------------------------------------------------------- Net interest margin 4.77% 4.77% --- 4.77% 4.77% 0.00 ------------------------------------------------------------------------------------------------------------- Efficiency ratio --- --- --- 49.70% 50.30% -0.60 ------------------------------------------------------------------------------------------------------------- Average equity to average assets 11.73% 10.85% 0.88 11.73% 10.85% 0.88 ------------------------------------------------------------------------------------------------------------- Note (1) Ratio change measured in bp Allowance for loan losses: ------------------------------------------------------------------------------------------------------------- Beginning balance $5,369 $5,092 5.44% $5,369 $5,092 5.44% ------------------------------------------------------------------------------------------------------------- Provision for losses 288 440 -34.55% 288 440 -34.55% ------------------------------------------------------------------------------------------------------------- Charge-offs -285 -269 5.95% -285 -269 5.95% ------------------------------------------------------------------------------------------------------------- Recoveries 48 127 -62.20% 48 127 -62.20% ------------------------------------------------------------------------------------------------------------- Ending balance $5,420 $5,390 0.56% $5,420 $5,390 0.56% ------------------------------------------------------------------------------------------------------------- Nonperforming assets: ------------------------------------------------------------------------------------------------------------- Nonaccrual loans --- --- --- $324 $137 136.50% ------------------------------------------------------------------------------------------------------------- Restructured loans --- --- --- --- --- --- ------------------------------------------------------------------------------------------------------------- Total nonperforming loans --- --- --- 324 137 136.50% ------------------------------------------------------------------------------------------------------------- Other real estate owned --- --- --- 1,470 751 95.74% ------------------------------------------------------------------------------------------------------------- Total nonperforming assets --- --- --- $1,794 $888 102.03% ------------------------------------------------------------------------------------------------------------- Asset quality ratios: Note (2) ------------------------------------------------------------------------------------------------------------- Nonperforming loans to total loans --- --- --- 0.08% 0.03% 0.05 ------------------------------------------------------------------------------------------------------------- Allowance for loan losses to total loans --- --- --- 1.31% 1.31% 0.00 ------------------------------------------------------------------------------------------------------------- Allowance for loan losses to nonperforming loans --- --- --- 1672.84% 3934.31% -2261.47 ------------------------------------------------------------------------------------------------------------- Note (2) Ratio change measured in bp